Mort­gage Mat­ters

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Some­times events align to form a per­fect op­por­tu­nity. We have that op­por­tu­nity to­day in Santa Fe real es­tate. What more can home­buy­ers ask for? The list of ben­e­fits awarded to buy­ers of Santa Fe real es­tate is grow­ing. Never in the last many decades have they been in such a per­fect sit­u­a­tion.

Af­ter years of a soft real es­tate mar­ket (since 2008), Santa Fe val­ues are ex­tremely at­trac­tive. Buy­ers have been able to re­ceive ex­cel­lent val­ues in re­cent sales. Buy­ers from Dal­las, Hous­ton, New York, Los An­ge­les (in­clud­ing film peo­ple), and Wash­ing­ton, D. C., all love Santa Fe and are be­gin­ning to pur­chase prop­er­ties here with gusto.

The fi­nan­cial mar­kets over the last sev­eral years have also cre­ated op­por­tu­nity. Long-term in­ter­est rates are avail­able to home­buy­ers at record low rates— how ex­cel­lent a 3.5 per­cent, 30-year rate is com­pared to the 5 per­cent rates a few years ago.

In early 2016, we have a 30-year fixed rate at 3.5 per­cent and ad­justa­bles at 3 per­cent and lower. Even jumbo rates are at record low in­ter­est rates.

The po­lit­i­cal cli­mate is also per­fectly aligned. A year of po­lit­i­cal drama sur­round­ing a pres­i­den­tial cam­paign usu­ally trans­lates to a very sta­ble eco­nomic year. This means that the Fed­eral Re­serve will be re­luc­tant to in­crease in­ter­est rates. So, we now have three per­fect align­ments: rates, val­ues, and pol­i­tics.

Buy­ers dur­ing the first part of 2016 have ne­go­ti­ated sternly with sell­ers. How­ever, I pre­dict that as the in­ven­tory of homes is re­duced, val­ues may be on the rise very soon. No one knows for sure, but re­ally good deals may not last to the end of 2016.

Will rates rise in the fu­ture? Ab­so­lutely. It’s just a mat­ter ofwhen. “Real es­tate has his­tor­i­cally been a great in­vest­ment; there­fore peo­ple should have real es­tate as a ma­jor part of their port­fo­lio,” said Francesca St­ed­man of Sotheby’s In­ter­na­tional Realty. “At Sotheby’s we cur­rently have ex­cel­lent op­por­tu­ni­ties for real es­tate pur­chases at com­pet­i­tive prices.”

Fi­nan­cial and real es­tate mar­kets al­ways change over time and this pe­riod of time in 2016 is no ex­cep­tion. Don’t be one of those who look back and say, “Why didn’t I buy in 2016?” The win­dow of op­por­tu­nity closes when (1) in­ter­est rates in­crease, (2) sell­ers ex­pect higher prices, (3) the econ­omy im­proves, and (4) in­fla­tion reap­pears. Take ad­van­tage now be­fore the win­dow closes.

Jim Gay was a real-es­tate bro­ker for 20 years and has been a con­sul­tant to Fortune 500 com­pa­nies. He is cur­rently a bro­ker/owner ofThe Mort­gage Place, Inc. (986-9080) and can be reached at jim@ jim­gay­home­m­o­rt­


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